FMCG sector slows by $8. Global site. The research also forecasts a further reduction by June 2. The drop is largely driven by a slowdown of consumption in Asia where FMCG growth is now at 5. The contraction was felt acutely in China where FMCG growth has fallen by a third in the past two years from 1. June 2. 01. 2, to 5. June 2. 01. 4. Latin America is now growing at 1.

While in some countries, including Ecuador and Colombia, this is driven by underlying growth in demand, in others it is the result of rising inflation. Although still performing strongly compared with mature markets in Europe and North America, the reduction in emerging market growth is significant.

Jason Yu, General Manager at Kantar Worldpanel China, explains: “Slowing economic growth across many emerging economies has led to shoppers reining in their spending on everyday goods. We now face a new reality where FMCG growth is more moderate. Competition will become fiercer as the size of the prize shrinks.

Overview Of FMCG Sector. FMCG in 2006 The performance of the industry was inconsistent in terms of sales and growth for over 4. Growth Drivers: FMCG Sector. FMCG sector slows by $8.3 billion as emerging markets cool. Global; Contact Us; WorldpanelOnline; M. FMCG Industry in India. Rural areas expected to be the major driver for FMCG, as growth continues to be high in these regions. Rural areas saw a 16 per cent.

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Brands will need to be even smarter when deciding which markets to target and when developing their approach within each country.“China makes up 6. Asian market and influences the whole region. Packaged food is the largest element of Chinese consumers’ budgets and sales have been particularly affected by the overall slowdown, growing by just 1. June 2. 01. 2. The region’s growth has been driven mainly by Brazil, which accounts for 4. FMCG consumption. In the past decade, lower and middle income households in Brazil have been able to afford goods that were previously out of their reach. More recently, however, rising inflation has led to consumers becoming savvier and looking for ways to make the most of their household expenditure.

Inflation has a strong impact in the region’s growth – Latin America’s FMCG demand in volume has only grown 2. June 2. 01. 4. Marcos Calliari, Managing Director at Kantar Worldpanel Brazil continues: “Inflation has not been restricted to FMCG and has been impacting the cost of other products and sectors like automotive, real estate, leisure, durable goods, and dining out as consumers decide to balance their budgets by staying in. FMCG consumption in Brazil is not an exception, and is now facing a turning point. Despite the rising inflation, demand peaked during the first quarter of 2.

Indian FMCG Sector Growth Drivers and Category Trends. Growth Drivers: FMCG Sector 1. Within the Indian FMCG industry.

Three months later, consumers have moderated their consumption. Today, the amount of products in baskets is the same as last year, but they cost more. Brands that can help Brazilians to keep a balance in their expenditure in the coming months will be those with a higher chance of success.”Opportunities for growth. Despite the slowdown in emerging market growth in general, there are still countries in which FMCG sales are performing strongly. Indonesia is one such example.

Although growth in Indonesia remains high at 1. June 2. 01. 3. Consumer confidence in this 2. GDP forecast by the International Monetary Fund (IMF) to grow by 5. Brands that have launched new products in Indonesia this year have taken advantage of consumer appetites to try new goods. Shoppers in rural areas in particular now have more disposable income and are being attracted to spend on more consumer products.

India has also accelerated its FMCG growth from 3. The top categories and channels. Ecommerce in emerging markets is an increasingly important channel and should be a prime target for brands. It is performing ahead of the market in Taiwan and China while South Korea is the world- leader in FMCG ecommerce with over half of all shoppers buying online. Chinese ecommerce is forecast to account for 3. FMCG sales by 2. 01. Certain categories within the consumer goods market are still posting strong growth.

Beverages, for example, are growing the fastest of any product category – 1. Asia and 8. 0% in Latin America. Personal care products are also performing well in both Asia and Latin America as consumers with higher spending power start to buy into these non- discretionary categories.